UEC an energy penny stock pops out of ascending channel LONG
UEC is a uranium company somewhat independent of the oil, solar and lithium stocks that
dominate the energy sector. Nuclear is touted as green and not contributory to climate change
with no carbon impact. It pollution or radioactivity is self-contained and isolated with heavy
regulatory safeguards All that said, a few days ago analysts at Eight Capital raised the status
of UEC to "strong buy" with a price target of $13 or about 75% above current valuation. Such
a high upside is uncommon in the energy sector.
The 4H chart shows price broke out from an ascending channel of several months
duration with a corresponding relative volume of 4x the running mean. The price action
is that of a high tight flag pattern invoking the moderately strong probability of more
bullish momentum after a consolidation is completed.
I see this as a great long swing trade with earnings coming in two months or call options
OTM targeting a strike price of $10 for the mid-March expiration. Given the stock price at
present such call options would have about $40 premium per contract.
Lastly, the ETFs URA and URNM appear to track the price action of UEC fairly well. If a trader
prefers diversification or risk moderation of ETFs these two are reasonable alternatives.
Uranium trades do not have geopolitical risk to consider as much as oil and gas yet another
reason to give this a further look.
.
dominate the energy sector. Nuclear is touted as green and not contributory to climate change
with no carbon impact. It pollution or radioactivity is self-contained and isolated with heavy
regulatory safeguards All that said, a few days ago analysts at Eight Capital raised the status
of UEC to "strong buy" with a price target of $13 or about 75% above current valuation. Such
a high upside is uncommon in the energy sector.
The 4H chart shows price broke out from an ascending channel of several months
duration with a corresponding relative volume of 4x the running mean. The price action
is that of a high tight flag pattern invoking the moderately strong probability of more
bullish momentum after a consolidation is completed.
I see this as a great long swing trade with earnings coming in two months or call options
OTM targeting a strike price of $10 for the mid-March expiration. Given the stock price at
present such call options would have about $40 premium per contract.
Lastly, the ETFs URA and URNM appear to track the price action of UEC fairly well. If a trader
prefers diversification or risk moderation of ETFs these two are reasonable alternatives.
Uranium trades do not have geopolitical risk to consider as much as oil and gas yet another
reason to give this a further look.
.
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